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President Announces Plans To Address Serious Financial Challenges

May 14, 2008

President Mark Huddleston has announced a series of strategies to help mitigate some of the financial challenges facing the university in FY09 and beyond. FY09 begins July 1, 2008.

In a letter to faculty and staff this week, Huddleston acknowledged that UNH has been through rough financial patches in the past and that faculty and staff have responded, conscientiously and creatively consolidating business services, offering separation incentive plans, finding ways to increase research funding, reorganizing COLSA, and increasing undergraduate and graduate enrollment.

However, he said, more long-term solutions are needed. “As effective as these efforts have been, our revenues and expenditures are still not fully in balance, nor will they be without further deliberate and decisive action. We must consider new measures to ensure that we continue to accomplish our core institutional missions with excellence and integrity,” according to Huddleston.

In late April, administrators reported to the campus community that financial forecasts for next fiscal year and beyond are grim due to projected slower revenue growth and increased expenses such that UNH’s reserve balance is seriously threatened. The average annual rate of growth of the general fund revenue is projected to be 4.6 percent while expenses are projected to increase at a rate of 6 percent from FY08 through FY10. According to Dick Cannon, vice president for finance and administration, this 1.4 percent gap is equal to $3.5 million annually.

Cannon added the gap could be as high as $8.8 million by FY10 if steps are not taken to address it now. “UNH has managed to address this funding gap over the past 10 years by growing its net tuition and research revenue at a rate exceeding our expense growth,” he explained, “but we cannot rely on such revenue growth in the future as we reach enrollment capacity and experience a much more competitive research funding environment.”

Huddleston’s plan is broken into two parts: strategies to address the FY09 deficit and strategies to address the ongoing “structural” deficit. The plan covers not only expense reductions but revenue goals as well.

Strategies are wide-ranging and include everything from invoking an immediate hiring freeze, to ensuring strong undergraduate and graduate enrollment, to reviewing options to control medical and energy costs, to substantially increasing private giving.

“Success with these strategies will require hard work, engagement, and patience from the entire campus community,” Huddleston noted. “It won’t always be easy or fun, but I am confident that grappling with our financial challenges now in a serious and focused way will position us to become an even stronger institution in the years ahead.”

 


 


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